Future Generator: An auspicious August for Iran

The ‘Future Generator’ is a highly unique and cutting-edge approach to political risk forecasting, developed by a partnership between Global Risk Insights (GRI) and Ethnographic Edge (EE). It combines GRI’s local human intelligence with EE’s ‘media sentiment’ data analytics to produce pinpoint accurate forecasting. By staying ahead of the curve, our readers will have more time to adapt to political events and maximize on opportunities.

The EE signal suggests further improvement of the diplomatic climate toward Iran

As produced by EE’s sophisticated app, it is projected that media sentiment towards the diplomatic environment surrounding Iran will continue to be positive over the course of this month. The green spot furthest to the right on the graph (above) is the starting point of the signal. We predict that the line will continue to project upwards, which indicates positive media coverage. Considering the strong correlation between media sentiment and political events, EE draws the conclusion that the diplomatic environment surrounding Iran will continue to improve until the end of this month.

GRI Assessment of the EE signal

GRI’s team of directors and our Iran expert have assessed this signal provided by EE. Based on local expertise and political risk training, we agree with the data analytics produced that Iran will continue to experience positive media coverage until the end of this month, indicating an improving political environment. This is likely to be the case for the following reasons:

1. Dispute between Saudi Arabia and Iran means that Iran will be peripheral in news from the Hajj

During this period, news media will be increasingly dominated by the Hajj, which will culminate on September 8th, when the pilgrimage rituals actually begin. Saudi Arabia and Iran have been unable to come to any agreement over the terms for this year’s pilgrimage as a result of the events surrounding last year’s stampede, which caused thousands of deaths including a significant number of Iranians. The dispute, though technically about the pilgrimage, is more difficult to resolve, because of the proxy conflicts between the two countries. The result is that any Iranians attending the pilgrimage will do so through a 3rd country and Iran will not feature heavily in Hajj-related news.

Iran is likely to feature less prominently in the coverage of the Hajj this year.

2. Iran’s opposition to ISIS implies positive media coverage, though dented by support for Assad

While the war in Syria has created a situation where Russia and Iran are opposed to US interests, all three countries are opposed to ISIS (Daesh). Iranian-backed forces have been fairly successful in their fight against ISIS and this is expected to continue. Media coverage of the conflict and Iran’s involvement through the end of August will be mostly positive, though there will be some negativity towards Iran’s support for Assad.

3. The economic outlook is improving through credit and trade

There are signs that the economic and business environment is gradually improving. In a recent deal, Norway opened up a $1 billion line of credit to Iran. This may encourage other European countries that have been interested in investing, but were hesitant due to concerns about US policy, to take similar steps at building economic ties. Credit will also ease Iran’s access to the market, creating further economic opportunity in the medium term. Further development of trade with Russia will also help to grow the Iranian economy, while creating a buffer against the possibility of future sanctions.

4. Reaction to simultaneous release of frozen Iranian funds and prisoners is dying down

Iranian funds that had previously been frozen in the US are being gradually released, which has caused a significant amount of negative press recently. Notably, the most recent shipment coincided with the release of prisoners from Iran, making it look like a ransom payment rather than a refund from frozen accounts. US officials have admitted that the possibility of further withholding the frozen funds was used to encourage the prisoner release. The negative press from this is gradually dying down, and a better understanding of the situation is developing, which will lead to more positive press regarding this issue going into September.

The ministers of foreign affairs of the United States and Iran, John Kerry and Mohammad Javad Zarif, meeting in Lausanne, Switzerland, 16 March 2015.

The Iran deal makes positive media coverage desirable for the US

Iran features dominantly in news coverage of the Middle East, because it is a significant regional player and often at odds with western foreign policy in the region. Iran’s increasing engagement in the global economy over the last year and the creation of economic ties to Europe and Russia mean that there will be little appetite for new sanctions, unless Iran significantly transgresses the bounds of the Joint Comprehension Plan of Action (JCPOA, also known as the Iran deal). Therefore, because the success of the JCPOA relies on it, the US has an interest in good news about Iran as well as growth and investment in Iran’s economy. The ‘Future Generator’ indicates positive news coverage of Iran will be the trend in the short term.

The Iran expertise in this report was provided by Kevin Graham.

Kevin Graham is a political risk analyst and historian of the Middle East with a background in Arabic and Persian translation. He holds a Bachelor’s degree in Philosophy and History, with a minor in Persian, from the University of California Berkeley, as well as an MA in Middle Eastern Studies from the University of Chicago and an MSt in Oriental Studies from the University of Oxford. He currently works as an editor for a global economic-research and publishing firm and lives in the Middle East.